In March, three Pakistani MINUSTAH troops were found guilty, sentenced to one year in prison and repatriated for the rape of a 14-year old Haitian boy. Although the trial was held on Haitian soil, it was a “military justice procedure…undertaken in accordance with the national laws of Pakistan,” according to the UN. Additionally, Reuters reported at the time that “Haitian government authorities were given no advance notice of the military tribunal.” Had the troops faced a Haitian court, their sentences would likely have been much longer. Had the troops had to face Haitian justice they may also have had to respond to further allegations that the Pakistani UN Mission tried to cover-up the crime, going so far as to kidnap the victim.

While some Haitian media and blogs picked up the story at the time, little has been written about the attempted cover-up.  Independent journalist Kathie Klarreich, who recently traveled to Gonaïves where the crime took place, mentioned the cover-up in a larger piece about MINUSTAH scandals for the Christian Science Monitor. Klarreich has now provided new details to HRRW on what happened, raising even more questions about the level of impunity for UN troops in Haiti and just how widespread these abuses are. While the Haitian police have witnesses and evidence tying MINUSTAH to the cover-up of rape, the UN has apparently not been cooperative and has failed to adequately investigate and hold accountable those responsible.

What Happened

The UN first disclosed the case in January, announcing that an investigative team would be heading to Haiti. In February, as the circumstances around the case became clearer, Senator Youri Latortue took to the airwaves to call for the lifting of immunity for MINUSTAH and to denounce the apparent cover-up that was executed by the Pakistani contingent. After witnesses of the abuse went to local police, the 14-year-old boy was kidnapped and taken to a MINUSTAH base in Cap- Haïtien with the “objective to prevent the continuation of the investigation” according to Latortue. On January 26, 2012, police arrested Vladimir Alexandre, a local Haitian, for being an accomplice to the kidnapping. Another alleged accomplice is still at large. While the “military tribunal” was conducted behind closed doors and the guilty members of MINUSTAH whisked out of the country, the local case in the city of Gonaïves has gone nowhere.

Alexandre, speaking with Klarreich, defended himself, telling her, “All I did was show them where he [the victim] lived. I don’t know anything about taking him anywhere,” adding that he didn’t receive anything from the soldiers in return. But Klarreich said that what he told her directly contradicts what he had told police when they arrested him.  According to a copy of his testimony which Klarreich read, Alexandre admitted that he knew the boy, that he’d been in contact with the Pakistani MINUSTAH troops, and that he and the other accomplice had agreed to remove the boy from the area. He also admits that the Pakistanis came to his home bearing gifts for his mother – $100 Haitian Gourdes ($12 US) and a sack of rice.

Alexandre remains in the police station jail, held in a room with 111 other prisoners. The Gonaïves police chief told Klarreich that according to Haitian law, Alexandre could be held for up to two months but if no charges were brought then legally he should be allowed to go free.  “I am not here to judge,” the police chief said, “but rather to make sure that the justice system works. Let’s remove the obstacles and finish this case.” The local officials in charge of the case continue to seek answers, while the lawyers for the victim continue to seek compensation from the United Nations.

The Washington Post editorial board is firmly non-committal on the question of whether the Fed should take more steps to boost the economy. On the pro side we have the fact that the economy is well-below full employment and growing slowly. Furthermore, the Post acknowledges that there is no threat of inflation. Given the Fed's twin mandates for full employment and price stability, it seems like we have a clear answer here.

But no, that would be too easy. The Post tells us:

"The Fed may also need to save ammunition to help deal with a financial collapse in Europe."

That sounds profound and important. Let's see, the Fed must save ammunition in case something really bad happens in Europe. But wait, isn't the Fed's ammunition the reserves it can issue? And, isn't the only real limit on the amount of reserves it can issue the concern about inflation? In other words, if it throws too much money out there and we don't have the ability to produce the goods and services to meet the demand, then we would get inflation.

However, the Europe disaster story is one where we are seeing a further hit to demand as Europe's economy implodes. How does it help in that situation that the Fed restrained itself in boosting the economy today? In fact, any boost to the U.S. economy will help, at least modestly, to boost European economies, thereby making an implosion less likely. Therefore concerns about an imploding Europe should provide yet another argument for more stimulus from the Fed.

Finally the Post tells us:

"Rather, slow growth may reflect structural factors, such as the huge household debt burden, which is declining but still equal to 83.6 percent of GDP. Then there’s the federal government’s out-of-whack tax and entitlement policies, and the uncertainty they generate.

"By effectively transferring much private and government debt onto its own balance sheet, the Fed bought time for the U.S. economy to rebalance under relatively benign conditions. Companies and households have used the time so far to deleverage significantly. More monetary easing now might buy the economy even more time to heal. But soon it will be government’s turn to adjust; the Fed can prop up growth, not engineer a permanent escape from fiscal reality."

Okay folks, today is my birthday so I’m going to be a bit self-indulgent here. Below is list of a number of important policy areas where I have been right at a time when the bulk of the economics profession was wrong. Yes, this is old-fashioned “I told you so” stuff. It can be seen as a bit arrogant and a bit obnoxious, but you have been warned.

I also understand that being right against the economics profession is not a terribly high bar. But hey, that is the competition.

1) The NAIRU Ain’t 6.0 Percent or Anything Like It

The conventional wisdom in the economics profession in the early and mid-90s was that if the unemployment rate fell much below 6.0 percent then inflation would accelerate out of control. This view was held not only by conservatives but also by more liberal voices within the mainstream like former Federal Reserve Board governors Alan Blinder and Janet Yellen.

Even Paul Krugman got this one wrong, comparing the economists who questioned the NAIRU theory to the scientists who questioned the existence of a hole in the ozone layer ("Voodoo Revisited." The International Economy. November-December, 1995, pp 14-19). I argued the case against the NAIRU in Chapter 16 of Globalization and Progressive Economic Policy. The book was published in 1998, but the first draft was in early 1996 when those of us who questioned the 6.0 percent NAIRU could still bank on a heavy dose of ridicule. For those who need reminding, the unemployment rate fell below 5.0 percent in 1997 and eventually hit 4.0 percent as a year-round average in 2000. There was virtually no uptick in inflation through this period, until a rise in commodity prices in 2000 finally began sending the rate of inflation somewhat higher

2) The Consumer Price Index Does not Substantially Overstate Inflation

Another big craze of the mid-90s was the claim that the consumer price index (CPI) substantially overstates the true rate of inflation. This sentiment peaked with the verdict of the Boskin Commission, consisting of five eminent economists who were appointed by the Senate Finance Committee to evaluate the accuracy of the CPI. In December of 1996 they came out with their report claiming that the CPI overstated the true rate of inflation by 1.1 percentage points. This was intended to be used as a rationale to reduce the size of the annual cost of living adjustment to Social Security. (Note that the cut is cumulative: after ten years it is roughly 11 percent, after 20 years it is roughly 22 percent.) It also would have changed the indexation of tax brackets in a way that would have led to higher tax rates for most people. Almost no economists were prepared to publicly challenge the Boskin Commission while many were happy to jump on the bandwagon.

July 2012, David Rosnick and Dean Baker

Mark Weisbrot
The Guardian Unlimited, 9 de julio de 2012
En Inglés

Vijaya Ramachandran and Julie Walz of the Center for Global Development recently reported on their trip to Haiti, where they further examined aid accountability and the ongoing reconstruction effort, the themes of their recent policy paper which we have p

Lawmakers at the federal and state level are talking seriously about increasing the minimum wage.  Business interests have been vocal in their opposition.  In a May 17 press release, for example, the National Federation of Independent Businesses (NFIB), an organization that often acts as a front for larger corporate interests, stated: “[The] NFIB is strongly opposed to raising the minimum wage, especially in the midst of an unemployment crisis. Small business owners warn that . . . there’s no way for them to absorb higher mandatory wages without cutting jobs.”  Even a brief analysis of the NFIB’s own survey reveals a very different picture.

While the NFIB warns that minimum wage increases would create serious cost problems for small businesses, few of their members list "labor costs" as their "most important problem."  Instead, what we see from the NFIB survey results is that the percentage of small businesses listing labor costs as their most important problem has hovered consistently between 3% and 5% since the beginning of the recession in December 2007.  In the most recent data, the percentage fell to 2%, its lowest level since the start of the recession. 

Mark WeisbrotThe Guardian Unlimited, July 9, 2012En Español